Nomination and Remuneration Policy

PROLIFE INDUSTRIES LIMITED

NOMINATION AND REMUNERATION POLICY

Introduction:

This policy on nomination and remuneration of Directors, Key Managerial Personnel and Senior Management has been formulated by the Committee, in compliances with Section 178 of the Companies Act, 2013 read along with applicable rules thereto.

Objectives of the Committee:

The Committee shall:

  • Formulate the criteria for determining qualifications, positive attributes and independence of a director and recommend to the Board a policy  relating to the remuneration of Directors, key managerial personnel and other  employees.
  • Formulation of criteria   for  evaluation of  the  Independent       Director and   to  carry   out evaluation of every  Director’s performance and  to provide necessary report to the Board  for further evaluation.
  • Devising a policy on Board diversity.
  • Identify persons  who   are   qualified  to  become  Director and persons  who   may   be appointed in  Key  Managerial and Senior  Management positions in  accordance with  the criteria laid down in this policy.
  • To provide to Key Managerial Personnel and Senior Management reward linked directly to their   effort, performance, dedication and   achievement relating to   the Company’s operations.
  • To retain, motivate and promote talent and to ensure long term sustainability of talented managerial persons and create competitive advantage.
  • Ensure  that   level   and   composition of remuneration is reasonable and   sufficient, relationship of remuneration to performance is clear and meets appropriate performance benchmarks.
  • To carry out any other function as is mandated by the Board from time to time and / or enforced by any statutory notification, amendment or modification, as may be applicable.
  • To perform such other functions as may be necessary or appropriate for the performance of its duties.
  • To develop a succession plan for the Board and to regularly review the plan.

Definitions:

  • "Act”:- Act means the Companies Act, 2013 and Rules framed therender, as amended from time to time.
  • “Board”:-Board means Board of Directors of the Company.
  • “Director”:-Directors means Directors of the Company.
  • “Committee”:-Committee means Nomination and   Remuneration Committee of the Company as constituted or reconstituted by the Board, from time to time.
  • “Company”:- Company means Prolife Industries Limited.
  • “Independent Director”:- As provided under the Companies Act, 2013, ‘Independent Director’ shall mean a non-executive director, other than a nominee director of the Company:

a) Who, in the opinion of the Board, is a person of integrity and  possesses relevant expertise and experience;

b) (i) who is or was not a promoter of the Company or its holding, subsidiary or associate company;

(ii) Who is not related to promoters or directors in the company, its holding, subsidiary or associate company.

c) Apart from receiving director's remuneration, has or had  no pecuniary relationship with the Company, its holding, subsidiary or associate Company, or their  promoters, or directors, during the two immediately preceding financial years or during the current financial year;

d) None  of  whose   relatives  has  or  had   pecuniary  relationship  or  transaction  with   the Company, its  holding, subsidiary or  associate Company, or  their  promoters, or  directors, amounting to two  percent. or more  of its gross  turnover or total  income  or fifty lakh  rupees or   such   higher  amount  as   may   be   prescribed,  whichever  is  lower,   during  the   two immediately preceding financial years or during the current financial year;

e) who, neither himself nor any of his relatives —

i) Holds or has held  the position of a key managerial personnel or is or has been employee of the  company or  its holding, subsidiary or  associate company in any  of the  three  financial years immediately preceding the financial year in which  he is proposed to be appointed;

ii) Is or has been  an employee or proprietor or a partner, in any  of the three  financial years immediately preceding the financial year in which  he is proposed to be appointed; of-

A) a firm of auditors or company secretaries in practice or cost auditors of the company or its holding, subsidiary or associate Company; or

B) any legal  or  a consulting firm  that  has  or  had  any  transaction with  the  Company, its holding, subsidiary or associate Company amounting to ten  per  cent  or more  of the  gross turnover of such firm;

iii. Holds together with his relatives two per cent or more of the total voting power of the Company; or

iv. is a Chief Executive or director, by whatever name  called,  of any non-profit organization that  receives  twenty-five per  cent  or  more  of  its  receipts from  the  Company, any  of  its promoters, directors or its holding, subsidiary or associate Company or that  holds  two  per cent or more of the total voting power of the Company; or

f. who possesses such other qualification as may be prescribed under the applicable statutory provisions/ regulations.

g. is a material supplier, service provider or customer or a lessor or lessee of the Company;

h. who is not less than 21 years of age.

  • “Key Managerial Personnel”:- Key Managerial Personnel (KMP) means-

(i)  the Chief Executive Officer or the managing director or the manager;

(ii)  the Whole-Time Director;

(iii) the Company Secretary;

(iv) the Chief Financial Officer; and

(v)  such   other   officer  as  may  be  prescribed under  the  applicable statutory  provisions/regulations.

  • “Senior Management”:- The  expression ‘‘senior management’’ means  personnel of the Company who  are  members of  its  core  management team  excluding Board  of  Directors comprising all members of management one  level  below  the  executive directors, including the functional heads.
  • “Nomination and Remuneration  Committee”  shall   mean   a  Committee  of  Board   of Directors of the Company, constituted in accordance with  the provisions of Section 178 of the Companies Act, 2013.
  • “Policy or This Policy” means, “Nomination and Remuneration Policy.
  • “Remuneration” means any money or  its equivalent given  or passed to any  person for services  rendered by  him  and  includes perquisites as  defined under the  Income-tax Act, 1961.

Unless  the  context  otherwise requires, words and  expressions used  in this  policy  and  not defined herein but defined in the Companies Act, 2013 as may be amended from time to time shall have the meaning respectively assigned to them  therein.

Guiding Principles

The Policy ensures that

i. The level and composition of remuneration is reasonable and sufficient to attract, retain and motivate Directors of the quality required to run the Company successfully.

ii. Relationship of remuneration to performance is clear and meets appropriate performance benchmarks and

iii. Remuneration to Directors, Key Managerial Personnel and  Senior Management involves a balance   between  fixed   and   incentive  pay   reflecting  short   and   long   term   performance objectives  appropriate to the working of the Company and  its goals.

Applicability:

The Policy is applicable to

  1. Directors (Executive and Non Executive)
  2. Key Managerial Personnel

iii. Senior Management Personnel iv. Employees

Constitution of the Nomination and Remuneration Committee:

The  Board  has  the  power to  constitute/ reconstitute the  Committee from  time  to  time  in order to make  it consistent with  the Company’s policy and  applicable statutory requirement. At present, Our Company has formed the Nomination and Remuneration Committee pursuant to Section 178 of Companies Act, 2013 and Regulation 19 of SEBI Listing Regulation, 2015 vide Resolution dated 07th September, 2016. The Nomination and Remuneration Committee comprise the following:

i. Anureet Kaur Jolly, Chairperson (Non-Executive and Non Independent Director).

ii. Nareshbhai Vanmalidas Thakkar, Member (Non-Executive and Independent Director)

iii. Nikunj Dineshkumar Soni, Member (Non-Executive and Independent Director)

Membership:

a. The Committee shall consist of a minimum 3 non-executive directors, majority of them being independent.

b. Minimum two (2) members shall constitute a quorum for the Committee meeting.

c. Membership of the Committee shall be disclosed in the Annual Report.

d. Term of the Committee shall be continued unless terminated by the Board of Directors.

Chairman:

a. Chairman of the Committee shall be an Independent Director.

b. Chairperson of the Company may be appointed as a member of the Committee but shall not be a Chairman of the Committee.

c. In the absence of the Chairman, the members of the Committee present at the meeting shall choose one amongst them to act as Chairman.

d. Chairman of the Nomination and Remuneration Committee meeting could be present at the Annual General Meeting or   may   nominate some   other   member to   answer the shareholders’ queries.

 Frequency of Meetings:

The Committee shall meet at such regular intervals as may be required.

Committee Members’ Interests:

A) A member  of  the   Committee  is  not   entitled  to  be  present  when   his  or  her   own remuneration is discussed at a meeting or when his or her performance is being evaluate.

B) The Committee may invite such executives, as it considers appropriate, to be present at the meetings of the Committee.

Secretary:

a. The Company Secretary of the Company shall act as Secretary of the Committee.

Voting:

a. Matters arising for determination at Committee meetings shall be decided by a majority of votes of Members present and voting and any such decision shall for all purposes be deemed a decision of the Committee.

b. In the case of equality of votes, the Chairman of the meeting will have a casting vote.

General Appointment Criteria:

i. The Committee shall consider the ethical  standards of integrity and  probity, qualification, expertise and   experience of  the  person for  appointment as  Director,  KMP  or  at  Senior Management level and accordingly recommend to the Board his / her appointment.

ii. The Company should ensure that  the  person so  appointed as  Director/ Independent Director/  KMP/  Senior   Management  Personnel  shall   not   be   disqualified  under  the Companies Act, 2013, rules  made  there  under or any  other  enactment for the time  being  in force.

iii. The Director/  Independent Director/  KMP/  Senior  Management  Personnel shall  be appointed as per the procedure laid down under the provisions of the Companies Act, 2013, rules made  there  under, or any other  enactment for the time being in force.

iv.The Company shall not appoint or continue the employment of any person as Managing Director/Whole-time Director/Manager who has attained the age of seventy years. Provided that  the term  of the person holding this position may be extended beyond the age of seventy years   with   the  approval of  shareholders  by  passing  a  special   resolution  based   on  the explanatory statement annexed to the notice  for such  motion indicating the justification for extension of appointment beyond seventy years.

Term / Tenure:

The Term / Tenure of the Directors shall be governed as per provisions of the Companies Act, 2013 and rules made there under as amended from time to time.

i. Managing Director/Whole-time Director/Manager (Managerial Person):- The Company shall appoint or re-appoint any person as its Managerial Person for a term not exceeding five years at a time No re-appointment shall be made earlier than one year before the expiry of term.

ii. Independent Director: - An  Independent Director shall  hold       office for a term  up  to five consecutive years on the Board of the Company and  will  be  eligible  for  appointment on passing of a special  resolution by the  Company and  disclosure of such appointment in the Board's  Report.  No  Independent  Director shall hold  office for  more  than  two  consecutive terms,  but  such Independent Director shall  be eligible  for appointment after  expiry of three years  of ceasing  to become  an Independent Director. Provided that  an Independent Director shall  not,  during the  said period of three  years,  be appointed in or be associated with  the Company in any  other  capacity, either  directly or indirectly. At the time of appointment of Independent   Director it   should be   ensured that   number of   Boards   on   which   such Independent Director serves as an Independent Director.

Evaluation:

The Committee shall carry out evaluation of performance of every Director, KMP and Senior Management at regular interval (yearly).

Removal:

Due  to reasons for any  disqualification mentioned in the  Companies Act, 2013, rules  made there  under or under any other applicable Act, rules  and  regulations or any other  reasonable ground, the  Committee may  recommend to  the  Board  for  removal of a Director, KMP  or Senior Management Personnel subject to the provisions and compliance of the said Act, rules and regulations.

Retirement:

The Director, KMP and Senior Management shall retire as per the applicable provisions of the Companies Act, 2013 and the prevailing policy of the Company. The Board will have  the discretion  to retain    the Director, KMP, Senior Management  in  the  same position/ remuneration or  otherwise even  after  attaining the  retirement age, for  the  benefit  of  the Company.

Criteria for Evaluation of the Board:

Following are the Criteria for evaluation of performance of the Board:

  1. Executive Directors:

The Executive Directors shall be evaluated on the basis of targets/Criteria given to executive

Directors by the Board from time to time

  1. Non Executive Director:

The  Non  Executive  Directors shall  be  evaluated on  the  basis  of the  following criteria  i.e. whether they:

(a) Act objectively and constructively while exercising their duties;

(b) Exercise their responsibilities in a bona fide manner in the interest of the Company;

(c) Devote sufficient time and attention to their professional obligations for informed and balanced decision making;

(d) do not abuse  their  position to the detriment of the company or its shareholders or for the purpose of gaining direct  or  indirect personal advantage or  advantage for  any  associated person;

(e) Refrain from any action that would lead to loss of his independence.

(f) Inform the Board immediately when  they lose their independent.

(g) Assist the Company in implementing the best corporate governance practices.

(h) Strive to attend all meetings of the Board of Directors and the Committees;

(i) participate constructively and  actively  in the  committees of the  Board  in which  they  are chairpersons or members;\

(j) Strive to attend the general meetings of the Company;

(k) Keep them well informed about the Company and the external environment in which it operates;

(l) Do not to unfairly obstruct the functioning of an otherwise proper Board or committee of the Board;

(m) Moderate and arbitrate in the interest of the Company as a whole, in situations of conflict between management and shareholder’s interest.

(n) Abide by Company’s Memorandum and Articles of Association, Company’s policies and procedures including code of conduct, insider trading etc.

Policy on Board diversity:

The Board  of Directors shall  have  the optimum combination of Directors from  the different areas/fields like production, Management, Quality Assurance, Finance,  Sales and Marketing, Supply chain,  Research  and  Development , Human Resources etc or as may  be considered appropriate. The Board shall have at least one Board member who has accounting or related financial management expertise and financially literate.

Remuneration:

The  Committee will  recommend the  remuneration to  be  paid   to  the  Managing Director, Whole   Time  Director,  KMP  and   Senior   Management  Personnel  to  the  Board   for  their approval. The level and  composition of remuneration so determined by the Committee shall be  reasonable  and   sufficient  to  attract,  retain   and   motivate  directors,  Key  Managerial Personnel and  Senior  Management of the quality required to run  the Company successfully. The relationship of remuneration to performance should be clear and meet appropriate performance benchmarks. The remuneration should also involve a balance between fixed and incentive pay reflecting short and long-term performance objectives appropriate to the working of the Company and its goals:

General:

  1. The remuneration / compensation / commission etc. to Managerial Person, KMP  and Senior  Management Personnel will  be determined by the  Committee and  recommended to the Board for approval. The remuneration / compensation / commission etc. shall be subjectto the  prior/post approval of the  shareholders of the  Company and  Central Government, wherever required.
  1. The remuneration and commission to be paid to Managerial Person shall be as per the statutory provisions of the Companies Act, 2013, and the rules made there under for the time being in force.
  1. Increments to the existing remuneration / compensation structure may be recommended by  the   Committee  to  the   Board   which   should  be  within  the   slabs   approved  by  the Shareholders in the case of Managerial Person.  Increments will be effective from the date of reappointment in respect of Managerial Person and 1st April in respect of other employees of the Company.
  1. Where any insurance is taken  by the  Company on behalf  of its Managerial Person,  KMP and  any  other  employees for indemnifying them  against any  liability,  the premium paid  on such   insurance  shall   not  be  treated  as  part   of  the  remuneration  payable to  any   such personnel. Provided that if such person is proved to be guilty, the premium paid on such insurance shall be treated as part of the remuneration.

Remuneration to Managerial Person, KMP and Senior Management:

  1. Fixed pay: Managerial  Person, KMP and Senior Management  shall  be  eligible   for  a monthly remuneration as  may  be  approved by  the  Board  on  the  recommendation of the Committee in accordance with  the statutory provisions of the Companies Act, 2013, and  the rules  made   there   under for  the  time  being  in  force.  The  break-up of  the  pay  scale  and quantum of perquisites including, employer’s contribution to P.F, pension scheme,  medical expenses, club fees etc. shall be decided and  approved by the Board  on the recommendation of the  Committee and  approved by  the  shareholders and  Central Government, wherever required.
  1. Minimum Remuneration: If, in any financial year, the Company has no profits or its profits are inadequate, the Company shall pay remuneration to its Managerial Person in accordance with the provisions of Schedule V of the Companies Act, 2013 and  if it is not able to comply with such provisions, with the prior approval of the Central Government.
  1. Provisions for excess remuneration: If any Managerial Person draws or receives, directly or indirectly by way of remuneration any such sums  in excess of the limits prescribed under the Companies  Act,  2013  or  without the  prior   sanction  of  the  Central  Government,  where required, he / she shall  refund such  sums  to the Company and  until  such  sum  is refunded, hold  it  in  trust   for  the  Company. The Company shall not waive   recovery of such sum refundable to it unless permitted by the Central Government.

Remuneration to Non-Executive / Independent Director:

i. Remuneration / Commission: The remuneration / commission shall be in accordance with the statutory provisions of the Companies Act, 2013, and the rules made there under for the time being in force.

ii. Sitting Fees: The Non- Executive / Independent Director may receive remuneration by way of fees for attending meetings of Board or Committee thereof. Provided that the amount of such fees shall not exceed the maximum amount as provided in the Companies Act, 2013, per meeting of the Board or Committee or such amount as may be prescribed by the Central Government from time to time.

iii. Limit of Remuneration /Commission: Remuneration /Commission  may  be paid  within the monetary limit approved by shareholders, subject to the limit not exceeding 1% of the net profits  of the  Company computed as per  the  applicable provisions of the  Companies Act, 2013.

Minutes of Committee Meeting:

Proceedings of all meetings must   be minuted and signed by the Chairman of the said meeting or the Chairman of the next succeeding meeting. Minutes of the Committee meeting will be tabled at the subsequent Board and Committee meeting.

Deviations from this policy

Deviations on   elements of this   policy   in   extraordinary circumstances, when   deemed necessary in the interests of the Company, will be made if there are specific reasons to do so in an individual case.